MIRA INFORM REPORT

Report Date :

11.02.2014

IDENTIFICATION DETAILS

Name :	ROPHARMA SA
Registered Office :	Brasov county / 500091 Brasov – 55 Iuliu Maniu Street, Etaj 1
Country :	Romania
Financials (as on) :	31.12.2012
Year of Establishments:	1952
Legal Form :	Joint stock company, joint venture of Romanian and foreign capital
Line of Business :	· Production of drugs by SC Aesculap Prod LLC (Targu Mures) Distribution of pharmaceutical and para-pharmaceutical Retailer of pharmaceuticals and cosmeceuticals
No. of Employees :	889

RATING & COMMENTS

MIRA’s Rating :

Ba

RATING		TATUS	PROPOSED CREDIT LINE
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory

Maximum Credit Limit :	USD 1647106
Status :	Satisfactory
Payment Behaviour :	Slow but Correct
Litigation :	---

NOTES :

Any query related to this report can be made on e-mail: infodept@mirainform.com while quoting report number, name and date.

ECGC Country Risk Classification List – September 30, 2013

Country Name	Previous Rating (30.06.2013)	Current Rating (30.09.2013)
Romania	B2	B1

Risk Category	ECGC Classification
Insignificant	A1
Low	A2
Moderate	B1
High	B2
Very High	C1
Restricted	C2
Off-credit	D

Romania ECONOMIC OVERVIEW

Romania, which joined the European Union on 1 January 2007, began the transition from Communism in 1989 with a largely obsolete industrial base and a pattern of output unsuited to the country's needs. The country emerged in 2000 from a punishing three-year recession thanks to strong demand in EU export markets. Domestic consumption and investment fueled strong GDP growth, but led to large current account imbalances. Romania's macroeconomic gains have only recently started to spur creation of a middle class and to address Romania''s widespread poverty. Corruption and red tape continue to permeate the business environment. Inflation rose in 2007-08, driven by strong consumer demand, high wage growth, rising energy costs, a nation-wide drought, and a relaxation of fiscal discipline. As a result of the increase in fiscal and current account deficits and the global financial crisis, Romania signed on to a $26 billion emergency assistance package from the IMF, the EU, and other international lenders. Worsening international financial markets, as well as a series of drastic austerity measures implemented to meet Romania''s obligations under the IMF-led bail-out agreement contributed to a GDP contraction of 6.6% in 2009, followed by a 1.1% GDP contraction in 2010. The economy returned to positive growth in 2011 due to strong exports, a better than expected harvest, and weak domestic demand. In 2012, however, growth slowed to less than 1%, partially due to slackening export demand and an extended drought that resulted in an exceptionally poor harvest. In March 2011, Romania and the IMF/EU/World Bank signed a 24-month precautionary stand-by agreement, worth $6.6 billion, to promote fiscal discipline, encourage progress on structural reforms, and strengthen financial sector stability. The Romanian authorities announced that they do not intend to draw funds under the agreement.

Source : CIA

Company name & address

NAME OF THE COMPANY	ROPHARMA SA (former IASSYFARM SA)
Address	Brasov county / 500091 Brasov – 55 Iuliu Maniu Street, Etaj 1
Phone no.	0040-268-547233, 547230 0040-232-230004	Fax no.	0040-268-547231
Web-site	www.ropharma.ro	E-mail address	office@ropharma.ro

HISTORIC/OFFICIAL DATA

Date of foundation

1952, as a State enterprise named “Oficiul Farmaceutic Iasi” in Iasi, Iasi county. By the Law 15/1990, in March 1991 it was transformed into a joint stock company named Iassyfarm SA. On September 6^th, 2007 it has changed its named and moved its headquarters in Brasov county and it was re-incorporated under a new registration number

Present legal form

joint stock company, joint venture of Romanian and foreign capital

Registered with the Trade Registry

J8/2886/2007 actual

J22/335/1991 former

VAT no.

1962437

Registered capital

50,959,936 RON

(since July, 2013, according to the National Trade Registry updated files)

Shareholders

Individuals

1. List of individuals, not detailed with the National Trade Registry

Participation

17.9731%

Legal persons

2. ADD PHARMACEUTICALS LIMITED – legal person from Cyprus

Address: Cyprus/ Limassol, 105 G.Griva Dhigenis Steides Court, Et.2, Ap. 202

Participation

17.5284%

3. AVAS (The Authority for the States Assets Recovery) – Romanian legal person

Address: Bucharest, sector 1 – Cpt. Alex. Serbanescu Street No. 50

Participation

0.3313%

4. ARROW PHARMACEUTICALS INC – American legal person

Address: USA/ 11590 Seminole Blvd. Siotr A11, 33778 Largo FL Street

Participation

31.2933%

5. RIMIA INVESTMENTS LIMITED – legal person from Cyprus

Address: Cyprus/ P.C. 33101 Limassol, Steides Court Et.2, Office 202

Participation

14.7054%

6. List of other legal persons, not detailed with the National Trade REgistry

Participation

18.1685%

Obligation to publish

According to the Romanian Financial Legislation, subject company is obliged to lodge with the Ministry of Public Finance its half-yearly accounts

EMPLOYEES

2007

2008

2009

2010

2011

2012

total

190

215

713

698

756

889

BUSINESS ACTIVITY

- production, distribution and retail trade with pharmaceuticals

· Production of drugs by SC Aesculap Prod LLC (Targu Mures)

Distribution of pharmaceutical and para-pharmaceutical

Retailer of pharmaceuticals and cosmeceuticals

For more details, please do visit www.ropharma.ro

Company is holding, in present, a chain of 115 drugstores and 6 branches (warehouses), under the ROPHARMA brand.

The five branches are:

1. ROPHARMA SA Sucursala Iasi – J22/3247/2007 (ware-house)

Address: Iasi county / Iasi – Smardan Street No. 19

Phone no.: 0040-232-230004; Fax no.: 0040-232-217601

E-mail address: office.iasi@ropharma.ro

2. ROPHARMA SA Sucursala Cluj-Napoca – J12/4459/2005 (ware-house)

Address: Cluj county / Cluj Napoca – Calea Baciului No. 47

Phone/Fax no.: 0040-264-418377

E-mail address: office.cluj@ropharma.ro

3. ROPHARMA SA Sucursala Bucuresti – J40/446/2006 (ware-house)

Address: Bucharest, sector 2 – Dimitrie Pompei Blvd. No. 9-9A

Phone/Fax no.: 0040-21-2046575

E-mail address: office.bucuresti@ropharma.ro

4. ROPHARMA SA Sucursala Bacau – J4/42/2007 (ware-house)

Address: Bacau county / Bacau – George Bacovia Street No. 52

Phone/Fax no.: 0040-234-512390

E-mail address: office.bacau@ropharma.ro

5. ROPHARMA SA Sucursala Targu Mures – J26/79/2007 (factory & ware-house)

Address: Mures county / Targu Mures – Livezeni Street No. 8

Phone no.: 0040-265-255034; Fax no.: 0040-265-255214

E-mail address: office.mures@ropharma.ro

Also, the company has opened another location in Chisinau/Moldavia, as follows:

Vadu lui Voda Street 2MD-2033

Chisinau / Moldavian Republic

Phone/Fax no.: 0037-22-479620

According to www.incomemagazine.ro / 10.04.2013 (economic magazine), ROPHARMA has decided to distribute the 2012 profits exclusively for future investments. The investment budget for 2013 will be of 2.3 m. EURO

The Investment budget Ropharma is intended for both retail chain expansion and development of the dietary supplements production, the company preparing for 2013 the launch of six new innovative products under its own brand.

ROPHARMA’s main distributors competitors: MEDIPLUS, FARMEXPERT, POLISANO and FILDAS TRADING

TRADING INFO

The company’s shares were quoted with the RASDAQ Electronic Exchange Market since January, 1997 (symbol: IAFR) until 24.11.2010.

Beginning with 24.11.2010 its shares are quoted with the Bucharest Stock Exchange, first category, under the RPH symbol.

Share capital: 50,959,936 RON

Nominal value: 0.1000 RON/share

No. of shares: 509,599,360

The most recent transaction day: November 28^th, 2013

Transaction volume: 350,500 shares

Price: 0.3600 RON/share.

No. of transactions: 3

Market capitalization: 186,003,766.40 RON

OTHER PARTICIPATION

1. Company’s participation

1. TEO HEALTH SA – J8/419/2010, VAT 26769017

2. AESCULAP PROD SRL – J26/303/2001, VAT 13843294

3. FARMACIA TESA SRL – J12/1175/2010, VAT 27211522

4. ROPHARMA PRODUCTION SRL – J22/19/2001, VAT 13664299

5. CRISTINA FARM SRL – J04/1453/2008, VAT 24310017

6. NIPAN-FARM SRL – J04/72/2000, VAT 12673248

2. Shareholders other participation

1. List of individuals

Not applicable

2. ADD PHARMACEUTICALS LIMITED

Not applicable

3. AVAS (The authority for the States Assets Recovery)

there are hundreds of companies where AVAS still holds participation

4. ARROW PHARMACEUTICALS INC

Not applicable

5. RIMIA INVESTMENTS LIMITED

VILLAGE RESORT - TOURS SRL –

J29/431/2001, VAT 13884669

TEO HEALTH SA – J8/419/2010,

VAT 26769017

6. List of other legal persons

Not applicable

REAL ESTATE (RON)

- lands & buildings

2007

2008

2009

2010

2011

2012

6,707,422

6,832,415

22,302,582

44,668,458

45,644,246

55,249,937

BANKS

ING Bank

MANAGEMENT

· as officially registered with the National Trade Registry

· Executives

President of the Board

Mr. Miron Mihai – Romanian citizen, born on 24.11.1960

Appointed on 17.06.2013; Expiration date of mandate: 17.06.2017

Member of the Board

Mr. Radasanu Alin Constantin – Romanian citizen, born on 10.05.1972

Appointed on 21.11.2011; Expiration date of mandate: 20.11.2015

Member of the Board

Mrs. Miron Florentina – Romanian citizen, born on 1.02.1956

Appointed on 29.04.2011; Expiration date of mandate: 29.04.2015

Member of the Board

Mr. Darabus Doru Vasile Victor – Romanian citizen born on 30.07.1961

Appointed on 17.06.2013; Expiration date of mandate: 17.06.2017

Member of the Board

Mr. Cotirla Adrian – Romanian citizen, born on 15.03.1970

Appointed on 17.06.2013; Expiration date of mandate: 17.06.2017

Branch representative (Manager)

Mr. Vartic Michael – Romanian citizen, born on 23.07.1969

Appointed on 10.12.2012; Expiration date of mandate: 10.12.2016

Administrator, legal person

CONSULTINVEST PHARM SRL – Romanian legal person (J8/115/2003/2003,

VAT 15149818)

Address: Brasov county / Brasov – Iuliu Maniu Street No. 55

Appointed on 29.04.2011; Expiration date of mandate: 29.04.2015

Represented by

Mr. Bratescu Mihai – Romanian citizen, born on 6.11.1965

Administrator, legal person

UNITED ROPHARMA SRL – Romanian legal person (J8/539/2001, VAT 13889464)

Address: Brasov county / Brasov – Iuliu Maniu Street No. 55

Appointed on 29.04.2011; Expiration date of mandate: 29.04.2015

Represented by

Mr. Ene Danut Marian – Romanian citizen, born on 11.08.1968

General Manager

Mr. Miron Mihai – appointed on 17.06.2013; expiration date of mandate: 17.06.2017

Financial Manager

Mr. Radasanu Alin Constantin

HR Manager

Mr. Ene Danut Marian

CURRENCY

Exchange rate of EURO

1 EURO = 3.6102 RON on 31.12.2007

1 EURO = 3.9852 RON on 31.12.2008

1 EURO = 4.2282 RON on 31.12.2009

1 EURO = 4.2848 RON on 31.12.2010

1 EURO = 4.3197 RON on 31.12.2011

1 EURO = 4.4287 RON on 31.12.2012

FINANCIAL DATA: RON

BALANCE SHEET	31.12.2011	31.12.2012
INTANGIBLES - TOTAL	2,449,431	10,588,316
TANGIBLES - TOTAL	53,954,555	65,589,578
FINANCIALS - TOTAL	13,617,316	11,637,039
FIXED ASSETS - TOTAL	70,021,302	87,814,933
STOCKS - TOTAL	44,273,210	36,911,324
CLAIMS - TOTAL	247,860,108	227,826,698
CURRENT ASSETS	317,537,723	270,904,386
PREPAID EXPENSES	788,007	391,482
DEBTS WITHIN 1 YEAR	291,992,463	240,266,831
DEBTS OVER 1 YEAR	5,061,758	10,145,720
PROVISIONS	54,314	898,501
ADVANCED INCOMES	26,012	25,166
REGISTERED CAPITAL	29,100,555	36,017,932
SHARE PREMIUM	1,962,780	1,962,780
RESERVES from reassessment of the fixed assets	37,263,935	46,656,421
RESERVES	14,349,967	24,415,472
PROFITS CARRIED FORWARD	0	7,844,989
NET RESULT - PROFIT	10,687,756	6,988,615
NET RESULT - LOSS	0	0
NET WORTH	91,212,485	107,774,583
PROFIT & LOSS ACCOUNT	31.12.2011	31.12.2012
Turnover	385,169,835	411,590,108
Own production & services	1,938,180	1,855,183
Sales	385,801,692	412,199,698
INCOMES FROM ORDINARY OPERATING ACTIVITY	385,900,892	415,147,266
Raw materials	3,873,487	3,847,508
Costs of goods sold	314,126,834	342,495,157
Wages	33,246,749	34,494,563
Depreciations & provisions	5,883,096	5,636,911
Other operating costs	20,109,869	22,564,713
COSTS OF ORDINARY OPERATING ACTIVITY	373,004,806	405,558,184
ORDINARY OPERATING RESULT - PROFIT	12,896,086	9,589,082
ORDINARY OPERATING RESULT - LOSS	0	0
FINANCIAL INCOMES	3,925,585	5,749,205
FINANCIAL COSTS	3,870,130	6,150,997
FINANCIAL RESULT - PROFIT	55,455	0
FINANCIAL RESULT - LOSS	0	401,792
CURRENT RESULT - PROFIT	12,951,541	9,187,290
CURRENT RESULT - LOSS	0	0
Extraordinary incomes	0	0
Extraordinary costs	0	0
EXTRAORDINARY RESULT - PROFIT	0	0
EXTRAORDINARY RESULT - LOSS	0	0
TOTAL INCOMES	389,826,477	420,896,471
TOTAL COSTS	376,874,936	411,709,181
PRETAX RESULT - PROFIT	12,951,541	9,187,290
PRETAX RESULT - LOSS	0	0
TAX ON PROFIT	2,263,785	2,198,675
NET RESULT - PROFIT	10,687,756	6,988,615
NET RESULT - LOSS	0	0

N.B.: any difference occurred between former reports and the present one regarding some positions of the “Balance Sheet” or P/L Account for previous periods does not belong to us.

The financial data from this report are the ones officially declared by the subject with the Ministry of Public Finance data basis for 31.12.2012. As consequence, the responsibility for their accuracy belongs exclusively to the company.

OUR OPINION

based upon financial figures reported in the latest balance-sheet – 31.12.2012

- all figures are reported in RON if otherwise not specified.

Size

large, considering the number of employees

Position & trend

well established company, well known, with a solid background. Company is quoted on the Bucharest Stock Exchange, first category, since November, 2010.

According to the figures, it develops a very large volume of activity, with positive, improving economic results.

In 2009 the company merged with other 3 companies (it absorbed them) and the turnover got developed consequently.

Generally, the financial standing got improved lately and it looks well..

The payments behavior is also fair enough – the delayed payments represent less than 3% of turnover.

Overall, this is a company with whom the business relationships are feasible and high credit figures are suitable.

31.12.2007

31.12.2008

31.12.2009

31.12.2010

31.12.2011

31.12.2012

Turnover

RON

61,183,599

82,294,855

288,285,159

351,997,844

385,169,835

411,590,108

EURO

16,947,426

20,650,119

68,181,533

82,150,356

89,165,876

92,937,004

Gross profit

RON

780,849

889,825

5,262,578

13,331,487

12,951,541

9,187,290

EURO

216,290

223,282

1,244,638

3,111,344

2,998,250

2,074,489

Net profit

RON

648,433

720,465

4,170,096

10,881,737

10,687,756

6,988,615

EURO

191,748

180,785

986,258

2,539,614

2,474,189

1,578,029

31.12.2012

CREDITS & LOANS (ACTIVE BALANCE)

34,389,696

Bank credits & other financial loans, on short term (within 1year)

29,432,108

Bank credits & other financial loans, on medium term (over 1 year)

4,957,588

BALANCE CLAIMS-DEBTS

negative

Total claims

227,826,698

clients & trade debtors

220,388,386

Total debts

250,412,551

- Short term

240,266,831

suppliers

193,325,885

trade creditors

10,150

bank credits & other financial loans

29,432,108

payable bills of exchange

12,050,786

other debts, including fiscal debts & dues to the Social Insurance

5,447,902

- Medium term

10,145,720

bank credits & other financial loans

4,957,588

other debts, including fiscal debts & dues to the Social Insurance

5,188,132

PAYMENTS BEHAVIOR

with delays

Total overdue of 2.76% of turnover (4.72% of total short term debt)

11,327,234

To suppliers, 5.86% delayed

11,327,234

over 30 days

9,118,546

over 90 days

2,148,386

over 1 year

60,302

PAYMENTS INCIDENTS, as

officially recorded with the Payment Incident Bureau

No incidents recorded in the period 2.12.2012 – 2.12.2013

FINANCIAL STRENGTH

31,253 tsd EURO

BUSINESS RELATIONS

Permissible

2007

2008

2009

2010

2011

2012

Good

Liquidity analysis

- current ratio

1.04

1.13

1.10

1.12

1.09

1.13

- quick ratio

0.67

0.66

0.86

0.98

0.94

0.98

Solvability analysis

Acceptable

- the borrowing ratio (total debts/net worth)

2.93

2.18

2.92

2.53

3.26

2.33

Profitability analysis (%)

Moderate

- return on capital

7.04

5.77

8.59

13.31

11.72

6.49

- return on assets

1.79

1.81

2.19

3.76

2.75

1.95

- gross profit margin

1.28

1.08

1.83

3.79

3.36

2.24

Activity analysis

Heavy settlements, specific to its line of business in Romania

- debtor’s days

76

66

138

195

235

202

- creditor’s days

123

96

136

163

224

171

Stocks turnover, times/year

6.40

6.54

8.39

12.29

8.70

11.16

FOREIGN EXCHANGE RATES

Currency	Unit	Indian Rupees
US Dollar	1	Rs.62.19
UK Pound	1	Rs.102.14
Euro	1	Rs.84.74

INFORMATION DETAILS

Report Prepared by :

NNA

RATING EXPLANATIONS

RATING		STATUS	PROPOSED CREDIT LINE
>86	Aaa	Possesses an extremely sound financial base with the strongest capability for timely payment of interest and principal sums	Unlimited
71-85	Aa	Possesses adequate working capital. No caution needed for credit transaction. It has above average (strong) capability for payment of interest and principal sums	Large
56-70	A	Financial & operational base are regarded healthy. General unfavourable factors will not cause fatal effect. Satisfactory capability for payment of interest and principal sums	Fairly Large
41-55	Ba	Overall operation is considered normal. Capable to meet normal commitments.	Satisfactory
26-40	B	Capability to overcome financial difficulties seems comparatively below average.	Small
11-25	Ca	Adverse factors are apparent. Repayment of interest and principal sums in default or expected to be in default upon maturity	Limited with full security
<10	C	Absolute credit risk exists. Caution needed to be exercised	Credit not recommended
--	NB	New Business	--

This score serves as a reference to assess SC’s credit risk and to set the amount of credit to be extended. It is calculated from a composite of weighted scores obtained from each of the major sections of this report. The assessed factors and their relative weights (as indicated through %) are as follows:

Financial condition (40%) Ownership background (20%) Payment record (10%)

Credit history (10%) Market trend (10%) Operational size (10%)

PRIVATE & CONFIDENTIAL : This information is provided to you at your request, you having employed MIPL for such purpose. You will use the information as aid only in determining the propriety of giving credit and generally as an aid to your business and for no other purpose. You will hold the information in strict confidence, and shall not reveal it or make it known to the subject persons, firms or corporations or to any other. MIPL does not warrant the correctness of the information as you hold it free of any liability whatsoever. You will be liable to and indemnify MIPL for any loss, damage or expense, occasioned by your breach or non observance of any one, or more of these conditions

This report is issued at your request without any risk and responsibility on the part of MIRA INFORM PRIVATE LIMITED (MIPL) or its officials.